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From ding dong to dot com, the multi-level marketing industry in 2019

Charles Green


July 17th, 2019

Consumers today have more influence and more knowledge about the products they want to purchase than ever before. If they are unsure about a product, they can read online reviews, watch YouTube videos, read discussion forums, and ask friends and strangers on social media. Within this world, how can multi-level marketing (MLM) companies continue to be relevant? That was the question we set out to ask when working on Belatrix’s latest whitepaper, which explores the multi-level marketing industry.

A few years ago, the head of Avon digital spoke about the shift from “ding dong” to “dot com”. However, as we highlight in the whitepaper, this describes just the first stage of this change, moving from physical channels to e-commerce. Today, the landscape continues to change, with social media becoming ever more important, and consumers who instinctively want to shop via their smartphone.

The challenge for many multi-level marketing companies, which have a long, traditional heritage, is how to become digital-first companies which can support their commissioned-based workforce with the tools to help them sell to a new generation of consumers.

We examine three key trends which MLMs are currently facing:

  1. The need for technological solutions for the MLMs commissioned-based workforce. No longer can individuals set up their business and simply start knocking on doors. Today, these individuals want products that they can easily share on social media; they need effective point-of sales systems; they want to be able to easily review their downline and commissions via a mobile application. They want to be able to use these tools to market products anywhere in the world.
  2. A fundamental shift towards social-selling. Perhaps more than any other dynamic that we examined, this move to how people sell, is key. The personal relationship between buyer and seller has now dramatically changed – what is important today is building relationships peer-to-peer via digital channels and social media.
  3. Training to turn representatives into influencers. In late 2018, Avon Products announced that up to 1 million of its’ representatives were to receive training on how to become a social media influencer. This is reflected of the broader changes in the retail industry, where many consumers now prefer to watch YouTube or look at Instagram posts to decide what to buy, rather than talk directly with a salesperson.

mlmBackground photo created by snowing – www.freepik.com

As a result of these trends, forward-thinking MLMs are investing significantly in technology, and reviewing their business processes. From creating innovative mobile applications, to building new data and digital capabilities, MLMs are in a period of significant change. As a consequence, we’re also seeing new partnerships emerge. Just recently, Avon Products announced that it was creating a new content studio with a production company as part of its digital transformation. It is doing this as it recognizes its representatives need quality content to share with their own communities, and be successful selling via digital channels.

Read the whitepaper here, exploring some of the key trends affecting the MLM industry, and how leading MLMs are using digital technologies.

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